Solar “net metering” extended by California regulators

If you’re a California resident who owns rooftop solar panels, you’ll want to pay close attention to a vote happening this morning in San Francisco.

The California Public Utilities Commission is scheduled to vote on extending the rules that compensate solar homeowners and businesses for the excess electricity that they feed onto the grid.

The system is called “net energy metering,” and it’s one of the main ways that California has encouraged the growth of the state’s solar industry. It’s also been the source of major friction between solar companies and California’s big electric utilities, who argue that net metering customers aren’t paying their fair share to maintain the grid.

So a California law approved last year ordered the utilities commission to come up with a replacement system by the end of 2015. That same law also told the commission to create a transition period for people who already have rooftop arrays. After all, those people were counting on the compensation they’d receive from net metering when they decided to go solar. The compensation, which appears as a credit on utility bills, lets many homeowners slash their monthly utility payments close to zero.

The proposal up for a vote this morning would let current net metering customers keep receiving compensation under today’s rules and rates for 20 years after their arrays were installed. Since most solar arrays in California were installed within the last five years, that means most solar homeowners can count on the current system for more than a decade into the future.

The same deal will apply to people who buy and install solar panels before July 1, 2017.

The utilities had pushed for a shorter grandfathering period, while some solar advocates wanted the current net metering system to apply for the entire lifetime of existing arrays. The commission’s proposal tries to strike a balance, making sure solar owners have enough time to recoup the money they invested in their equipment.

“This proposal would be a good outcome,” said Susannah Churchill with the Vote Solar advocacy group. “California solar homeowners and businesses can move forward with certainty. What we wanted was to make sure the rules would stay fair for customers who had already made an investment in solar, to the benefit of all of us.”

So what will the next version of net metering look like? The commission has not yet decided. That fight still lies ahead.

UPDATE: The commission approved the 20-year grandfathering period Thursday morning. “With this decision, the Brown Administration is sending a clear message that California will always be a solar friendly place,” said Brad Heavner, Policy Director of the California Solar Energy Industries Association.